Checking In With David Nexon

For more than two decades, David Nexon has had a voice in the health policy debate. His long tenure as a congressional staffer — as health policy staff director for the Senate Health , Education, Labor and Pensions Committee and adviser to Democratic Sen. Edward Kennedy of Massachusetts — led the National Journal to dub Nexon “the Dean of Health Care Policy in the Senate.” Now, as senior executive vice president of Advanced Medical Technology Association, which represents the medical device manufacturers, he’s working to ensure that any health care overhaul doesn’t “artificially prevent new technologies.”

AdvaMed was one of a half a dozen health industry groups that pledged to the White House in May to help reduce costs by $2 trillion over the next 10 years. “Right now, we’re really concentrating on how we’re going to implement the commitments that we made,” Nexon says. He talked to KHN reporter Jennifer Evans about the important decisions that lie ahead as Congress works to sculpt health legislation. Here is the edited interview.

Q: The issue of comparative effectiveness research has drawn some criticism from those worried it will hinder technology advances. What’s AdvaMed’s position on the research?

A: We strongly support comparative effectiveness research for determining what’s best for the individual patient — what treatment works best under what circumstances. At the same time, we are strongly opposed to cost-effectiveness research. Cost-effectiveness is a very artificial device, a way of trying to decide that you shouldn’t pay for something that’s may be best for the individual patient, and we don’t think that’s the right direction.

Q: How do you respond to critics who say that advances in medical technology — and in some cases, overuse of technology — are one of the factors driving up costs?

A: I think it’s probably true to some measure. There is certainly inappropriate use of technology. There are some circumstances where there’s really not a good scientific basis for deciding what’s the most effective treatment, or what’s an appropriate treatment for an individual. There’s some underuse as well.

Q: Does your group have suggestions on how to use technology correctly, not in a way that fuels unnecessary medical spending?

A: We don’t determine how our products are used. We are suppliers to physicians and hospitals and other health care providers, so our leverage is somewhat limited, but as part of our commitment to the president we [are] working closely with the consortium the American Medical Association has put together to develop quality measurements for care.

Q: What does that mean exactly? How to use the equipment?

A: The equipment is safe and effective. It has been approved by the Food and Drug Administration so the question is really: Under what circumstances is it appropriate to use it? The AMA has identified a number of areas where they think there’s excessive or inappropriate use. [There’s] a significant subset of people who get treatment who either don’t need it, don’t benefit from it or are getting it too soon. Our manufacturers have a tremendous amount of expertise in the appropriate use of their equipment so we’ll be trying to cooperate with this effort to help determine when use is inappropriate.

Q: Are you at all worried that efforts to contain costs will restrict patients and physicians from gaining the use of new technologies?

A: I think we certainly need more incentives in the system for people to deliver care efficiently. We need to do a lot more to prevent disease, especially chronic disease, and we need to do a better job of managing disease. All those things are going to reduce the utilization of our equipment. If you keep people out of the hospital they’re not going to get high-tech medicine because you prevented them from getting the disease in the first place. If you reduce the incidence or arthritis or manage [it] better, fewer people are going to need hip and joint replacements. We think that’s appropriate. We’re not in the business of trying to provide people with stuff for medical care that can be avoided. We are interested in fulfilling legitimate clinical needs.

What we are very concerned about is anything that would artificially prevent new technologies that are better [from being] available to people who may be able to benefit from them. Medical diagnostics and devices continue to get better and more cost-effective over time because of two factors: operators’ skill increases and our products improve rapidly.

I think you’ve got to make some special provision for new technology. The problem isn’t really new technology, it’s widespread inappropriate use of existing technology to the extent that there’s a cost issue, so you need to put some special wrinkles in pay-for-performance or accountable care organizations or any of these devices which are designed to incent efficiency to give a little special room for new products — give them a chance to prove themselves in the same way we’d want to exempt clinical trials.

Q: Are you worried that pay-for-performance efforts might discourage physicians from offering the latest technology to their patients?

A: You don’t want to penalize the guy because he’s the first one to start using something that may turn out to be a much better technology. Many devices lower costs rather than raise them. But some are going to be more costly than the existing standard of care and again, if someone is going to be an early adopter of a device before it’s fully mature, or before it’s diffused so you can judge what two costs and benefits are, you don’t want to penalize them.

Q: A lot of people have said that imaging technology has been overused, and the administration wants to take steps to hold down some of these related costs in the Medicare program. What’s your response?

A: We’re concerned there’s a bit of an overreaction. Sure, there’s some inappropriate use because it’s non-invasive so it’s relatively easy to order an imaging study. But, at the same time, the reason [it] has become the target is because it’s been growing more rapidly than most other areas of medicine. I don’t think that’s because it’s more inappropriately used. It’s just that its one of the most technologically advanced and rapidly evolving areas. When penicillin was first introduced, it was growing exponentially. That wasn’t a problem. That was a good thing. So, I think there’s inappropriate use of imaging but I think [that notion] has been overplayed.